At the 2017 CES, Nvidia, the industry's leading graphics processing designer, announced a major partnership with auto giant Audi. Nvidia and Audi also confirmed plans to have a fully autonomous vehicle by 2020 at the recent 2017 CES, the big trade event in Las Vegas.

According to Business Insider, Nvidia CEO Jen-Hsun Huang gave a keynote address on self-driving technology. Huang said that Nvidia and Audi are developing a self-driving car that will be on the roads by 2020.

Nvidia And Audi Partnership

Nvidia's Audi partnership will place the company's core graphics processing technology into vehicles built by the German auto giant. This is not the first time that the two companies have made such partnership. The two have already worked together in the past, but was only limited to Audi's personal navigation systems.

This time, things are about to change for both companies. Audi will start using Nvidia's Drive PX processor and Drive computing platform to help build the planned self-driving vehicle. The German automaker has already showcased a Q7 SUV concept vehicle equipped with these self-driving technologies and now it plans to start testing that vehicle in California and other states by the year 2018.

Latest Partnership Means Competition With Tesla

During the company's keynote address at CES 2017, Nvidia introduced and discussed the long-awaited successor to Drive PX, the company's core automotive platform.

According to ReadWrite, the new platform, Xavier, has eight high-end CPU cores, 512 of our next-gen GPUs. It also claims it has a new platform with the performance of a high-end PC shrunk onto a tiny chip with teraflop computing power. In addition to the driving platform, Nvidia also discussed an AI technology known as the A.I. Co-Pilot, which alerts drivers of potential hazards on the road.

Unfortunately, this development has placed the two companies in direct competition with some of the biggest tech companies.

Additionally, the self-driving space is getting more intense these days with more tech companies jumping into the fore. Auto giants such as BMW and Nissan are also making its presence felt. Not to mention tech giants like Uber and Google, which are also on a hot chase, testing autonomous vehicles on the road.

However, no company has yet tested a fully autonomous vehicle on roads without a driver.

With this development, Nvidia might end up competing in a brutal environment and might fall behind in terms of the technological arms race. And with exact deployment plans still unclear, the two might may fail to profit from their self-driving efforts.

The timing might not good for Nvidia because it will open a brutal two-front war, first against AMD in the gaming market and then, against a bunch of laser-focused companies led by Tesla. Nvidia will also need to allocate a significant amount of its resources for this new campaign. This could lead to some distraction from its core GPU gaming business.